Hardware Retailing The Industry's Source for Insights and Information
Back in 2002, Nickelback was No. 1 on the charts, the Anaheim Angels had just won the World Series and a little TV program called “American Idol” was taking the nation by storm.
It was also in 2002 when the North American Retail Hardware Association (NRHA) released an update to its landmark Merchandising for Profit Study, which helped retailers better understand the impact featured merchandising techniques could have on product sales.
Flash forward 14 years and things are quite a bit different. American Idol has left the airwaves, the Anaheim Angels are now the Los Angeles Angels of Anaheim and Nickelback is, well… not so popular.
With all of these changes in our society, including the emergence of constant communication, online shopping and internet marketing, NRHA felt it was time to put the findings of the last Merchandising for Profit Study to the test and determine if in-store merchandising still had the same impact it once did.
Together with help from Indianapolis-based market research firm The Farnsworth Group and nearly a dozen retailers from across the U.S. and Canada, NRHA set out to update its Merchandising for Profit Study.
With the research complete, it is clear that while Nickelback may not be selling out stadiums anymore, in-store merchandising techniques are still as viable as they were 14 years ago.
“These new findings can hopefully help retailers, distributors and manufacturers really see the kind of impact that merchandising can have in-store,” says Dan Tratensek, NRHA vice president and publisher of Hardware Retailing.
“Going into this study, we weren’t quite sure what the data would yield because the way people shop has dramatically changed, but the data supports the fact that solid in-store merchandising is still effective,” he says.
The Study
This year’s update to the Merchandising for Profit Study was conducted over a three-month period in late summer. Retailers volunteered to participate in the study and test different merchandising techniques in real-time retail environments.
The different merchandising techniques tested included:
- Disposable dump bins
- Permanent dump bins
- Power aisle stack outs
- Service counter displays
- Checkout displays
- Clip strips
- In-aisle feature/benefit signs
- Feature endcaps: signage
- Feature endcaps: items
To determine the kind of sales lift these merchandising techniques could generate, they were tested by multiple retailers in different markets. Retailers agreed to leave the items stocked in their in-aisle position but also stock the product using the featured merchandising technique. Sales for the items tested were monitored before, during and after the test period, and control stores were also used to eliminate any market variables.
The final sales data from both the control and test stores was weighted, and outliers were removed. The percentages presented in this report represent the mean average of sales lift experienced by products during the test period.
“The results of the update to the Merchandising for Profit Study prove once again that attention to detailed merchandising can provide sales lifts in both promotional and in-the-aisle settings,” says Jim Robisch of The Farnsworth Group. “Clearly, it is a reminder of how retailers have in-store solution options to the challenges of increasing their closure rates and transaction sizes with customers.”
The Findings
You can find many of the results of this year’s study in the download below. Along with those results, we’ve listed the results from the 2002 study so you can compare the numbers side by side and take note of any significant changes.
The Report
Fill out the form below to download the complete 2016 Merchandising for Profit Study.
For more information about this year’s findings, contact Dan Tratensek at DanT@nrha.org. For more information on The Farnsworth Group, visit thefarnsworthgroup.com or call 317-241-5600.
NRHA would like to thank the following organizations for helping in the research of the Merchandising for Profit Study: Aubuchon Hardware, Buchheit, Friedman’s Home Improvement, Home Hardware Stores Ltd., Marvin’s and Stine Lumber Co.
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